The International Monetary Fund said that the world's banking system is on the verge of a "meltdown" and that the problem had to be addressed immediately.
The U.S. Treasury has not made it clear which banks it may invest in to supply capital, how much that may be, and exactly when it will happen. It has also said the the buying-in of toxic assets may take several months. In other words, the government is moving fairly slowly and with some caution.
The American reaction may simply come too late. The U.K. has already begun the process of putting money into its largest banks. Whether or not it will work is a matter of conjecture. But, the British are not going to dawdle. Time is too short.
If the Treasury Department and the Fed do not make some very significant and specific description of their plans before the markets open Monday, they may see the largest daily drop the market has ever seen.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
10-12-2008 @ 3:11PM
william lindblad said...
Doug, they said basically the same thing - months ago. There are a lot of people, myself included, that have been saying that this is coming for over two years.
Out of all the leadership only Trichet and the Chinese believed it.
C'est la vie - CYA
(Trichet was in no position to do much but he did keep rates up)
10-12-2008 @ 7:30PM
moneymaker said...
I know one thing if they do drop by another 1000 points on the DOW I am going to put as much as I can into It at that point.
10-12-2008 @ 10:22PM
bart said...
Is the market even open monday?